Microsoft Inc. (NASDAQ/MSFT) is laying off thousands of employees and writing off its smartphone business as part of an effort to keep up with the fast-moving technology landscape.
On Wednesday, July 8th, the software giant announced it would cut 7,800 jobs, mainly in the smartphone sector. The company will take a $7.6 billion impairment charge to restructure this business.
Microsoft had been shifting its operation from selling computer operating systems like Windows to emerging niches like smartphones and other mobile devices. However, the reorganization has not been successful with the company’s market share shrinking since its acquisition of Nokia in 2014.
The move is just the latest from the company’s new Chief Executive Officer Satya Nadella. The industry veteran, who became chief executive last year, has been trying to revive the company’s fortune. However, so far his efforts have not been successful with Microsoft shares trading down 4.6% so far this year.
In the company’s press release, Nadella said he is no longer focused on the growth of the company’s own smartphone business. Instead, he’s emphasizing the expansion of the broad “ecosystem” of products, including mobile phones that ran Windows software. (Source: Microsoft, July 8, 2015.)